The federal statistics office, Destatis, reported on Monday that private sector employers in the country paid 34 percent more per hour than the European average, but three percent lower than in neighbouring France.
The country was neck and neck with Finnish employers.
And recent years have seen a steady growth in labour costs in Germany, with private employers paying on average 2.7 percent more per hour each year between 2011 and 2013. From 2004 to 2010 it only rose by an average of 1.4 percent each year.
Workers in Germany could also enjoy their biggest annual wage rise this year since 1992, Bild newspaper reported on Monday, because of low inflation and wage agreements made between workers and their employers.
“An upturn is finally in sight in Germany which could benefit the whole population,” Gustav Horn from economic institute the IMK said.
The highest overall hourly labour costs, according to Destatis, were in Sweden, whose employers pay an average €43 an hour, followed by Belgium (€41.2) and Denmark (€39.80).
The country with the lowest average hourly costs in the EU was Bulgaria at €3.70.
In the manufacturing sector, German industrial employers paid out an average of €36.20 per hour, placing them fifth in the EU after Sweden, Belgium, Denmark and France respectively.
The UK ranked almost exactly in the middle of the bunch at 13th, with average hourly costs in the private sector at €21.10, and labour costs in manufacturing standing at €22.
Labour costs consist of gross wages added to non-wage costs, including social security and pension contributions.